GENEVA SEEKS FUNDS FOR COKELESS FACILITY

Geneva Steel is seeking a $120 million grant from the U.S. Department of Energy to build a cokeless ironmaking facility.

Joseph A. Cannon, Geneva's chief executive officer, announced the company is investigating cokeless steelmaking during a speech Wednesday in Washington, D.C. at the general meeting of the American Iron and Steel Institute.The process, called COREX, uses coal rather than coke to make steel, shortening the production process and eliminating the need to operate coke ovens, one of the most negative environmental aspects of steelmaking.

Deutsche Voest-Alpine Industrieanlagenbau GMBH, a German engineering firm and subsidiary of the Austrian company Voest-Alpine, developed the COREX process. The process is currently being used by Iscor Co. in Pretoria, South Africa, with promising results, said Dick Clayton, environmental vice president at Geneva.

"They've produced good quality hot metal and done it on a continuous basis," Clayton said.

Emissions from the COREX process are similar to blast furnace emissions and are insignificant, he added.

Coke ovens produce a large portion of pollutants at a steel mill, including benzene, a carcinogen. Geneva's coke ovens are expected to need rebuilding or replacing in 10 to 15 years.

"If we can get it (the grant), it is a home run from an environmental standpoint and it is a home run from an iron production standpoint," said Cannon, who returned to Utah Wednesday night.

Geneva submitted an application for a $120 million matching grant last week under the Clean Coal Technology Program operated by the Department of Energy. The company will learn in September whether it will receive the grant.

Voest-Alpine and Bechtel, a worldwide construction firm with headquarters in San Francisco, are partners with Genevain applying for the grant. As part of the application, Geneva included a letter from Merrill Lynch Pierce Fenner & Smith Inc. indicating the project is "financeable," Cannon said.

The Department of Energy grant would fund about 50 percent of the capital cost of building one COREX unit. The single COREX unit would replace one of Geneva's three blast furnaces and be capable of producing 730,000 tons of steel annually or approximately 2,000 tons of steel per day.

Dozens of companies submitted grant applications, Clayton said. In the past grants from the Clean Coal Technology Program have largely gone to eastern companies, primarily power utilities.

"That could cut in our favor," Cannon said. "In my view it's about time we got a clean coal grant in the western U.S."

Geneva applied for a Clean Coal Technology grant in 1989 for the same purpose but did not receive one. This time around, the company's chances may be bolstered by its project partners, Clayton said.

"We're hopeful about our chances, but it is a difficult program to get funding through," he said.

If Geneva receives the grant, it will take one year to negotiate a cooperative agreement with the Department of Energy and then three years to design and build the COREX unit, Clayton said.